Sunday, March 19, 2006

Ethanol Use In High Gear In Brazil

mar 19th

good question. is oil the one and only answer? india is not doing enough to explore the alternatives. although i am not sure creating large sugarcane plantations is the answer either.

why is nobody in india pursuing this or bio-diesel from plants like jatropha? because the opportunities for bribes from the arabs (and from the nuke-peddlers in america) are much greater than the opportunities for bribes from sugarcane growers and jatropha growers. simple, rational economic calculation.

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From: parr

From courant.com
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Ethanol Use In High Gear In Brazil
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South American Nation Is Decades Ahead Of U.S. As Alternative Fuel Already Powers Millions Of Cars

By ALAN CLENDENNING
Associated Press

March 15, 2006

SAO TOME, Brazil -- In an agroindustrial complex ringed by fields of 12-foot-high sugarcane, a giant mechanical claw dumps stalks by the tons into an even larger crushing machine. Here's where the renewable fuel used to power seven of every 10 new Brazilian cars gets its start.

Sugary slurry flows into a row of gleaming stainless steel distilling tanks, transforming cane harvested only hours earlier by machete-wielding farm laborers into ethanol, the alternative fuel now promoted by President George Bush to end what he calls America's addiction to imported oil.

Although Bush set 2025 as the target date for replacing three-fourths of the oil imported from the Middle East with American ethanol, Brazil already satisfies nearly half of its domestic passenger vehicle fuel demand with ethanol.

After decades of government intervention and subsidies, the industry in Sao Tome is a thriving free market business, complete with ethanol pumps at every filling station in Latin America's largest country. Millions of cars run on ethanol, gas or any combination of the two. And there's plenty more land available for sugar cane cultivation as the planet's biggest sugar producer gears up to become its long-term ethanol supplier.

Brazilian ethanol producers and international energy experts agree that the United States will probably never come close to reaching Brazil's potential as an ethanol superpower. But they say Brazil offers clear lessons about how to boost domestic ethanol use. What the United States needs most, they say, are more cars that run on the fuel, and filling stations that offer it.

"Petroleum is almost history," warned Celso dos Santos, commercial director of the Cocamar farmers' cooperative that owns the Sao Tome distillery. "People stopped using wood for fuel, and replaced it with coal. Then came petroleum, but we're getting to the end of the petroleum era."

With the sickly scent of pure alcohol wafting through the air around the Cocamar plant, a thousand workers toil around the clock during the March-to-November cane harvest season, distilling 92,500 gallons of ethanol daily that is trucked away for immediate sale at the pumps.

Sugarcane waste is burned to generate steam for the turbines, meeting all of the plant's electricity needs. Excess power will soon light half of the homes in Sao Tome, a southern Brazilian town of 6,000.

The technology is not even cutting-edge, but the industry is making profits like never before and has a bright future, thanks to a 1970s decision by Brazil's former military dictators to subsidize ethanol production and require distribution at every gas station.

A 1980s Brazilian fad with cars that ran only on ethanol petered out when oil prices fell in the early 1990s. But the fuel came back into vogue in 2003, when automakers started rolling out cars that run on gasoline, ethanol or any combination of the two. With international oil prices reaching record highs, Brazilian drivers turned to "flex-fuel" cars, buying ethanol at half the price of gas until late last year.

Some experts predict that flex-fuel car sales will reach 90 percent of Brazil's new car market within several years, while others say recent ethanol price increases could keep penetration at the current level.

Getting a fraction of that acceptance in the United States could take decades, analysts say, even with new incentives and regulations.

"Since the government does not dictate what happens in the marketplace, the process will be much slower than what Brazil experienced," said Amani Elobeid, an economist and international sugar analyst at Iowa State University.

A small but growing percentage of American-made vehicles are made to run on the U.S. version of ethanol called E85, which is 85 percent alcohol distilled from corn and 15 percent gasoline. But many American drivers don't even know that their vehicles can run on E85, and the fuel is available at only 610 American filling stations.

Brazil's state-imposed pump price for gasoline includes much higher taxes than the price U.S. consumers pay. Gas in Brazil now costs the equivalent of $4.69 a gallon. Pure ethanol - taxed at slightly lower levels and cheaper to produce - goes for about $3.59 a gallon at all of the nation's 30,000 stations. It fueled 48 percent of Brazil's passenger vehicles last year.

Meanwhile, Brazil is trying to encourage ethanol use in countries from Asia to Europe. President Luiz Inacio Lula da Silva said in Britain this week that Brazil wants "to plant the oil of the future" and promote radical changes in how the world generates energy.

Brazilian ethanol makers intent on boosting exports have been beaming ever since Bush used his January State of the Union address to plug ethanol.

"We felt that in our share price," said a smiling Paulo Diniz, chief financial officer of Grupo Cosan, Brazil's largest ethanol producer and the world's second-largest after U.S.-based Archer Daniels Midland Co.
Copyright 2006 Associated Press


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8 comments:

daisies said...

http://www.jatropha.de/


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daisies said...

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http://www.jatropha.de


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daisies said...

Jan '02
Bio-diesel plantations may actually happen:
http://www.goodnewsindia.com/Pages/content/updates/story/23_0_4_0_C

Jan '03
Railways take a serious look at bio-diesel:
http://www.goodnewsindia.com/Pages/content/updates/story/46_0_4_0_C

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saras said...

Too much brouhaha is being raised about using alcohol by the agricultural route as fuel. Here's an article by Kevin Hassett, who argues that bio-ethanol is not attractive as it is made out to be.

The article goes like this:

In his State of the Union address, George W. Bush called for an intense effort to develop more efficient alternative fuel sources.
``We will also fund additional research in cutting-edge methods of producing ethanol, not just from corn but from wood chips and stalks or switch grass,'' the president said. ``Our goal is to make this new kind of ethanol practical and competitive within six years.''
Bush should have known better. In a capital city that is full of shameless political scams, ethanol is perhaps the most egregious. There has probably never been a specific topic around which so much disinformation is spread. Ethanol lowers our reliance on fossil fuels! Ethanol helps clean the environment! Ethanol will save the family farm!
Such sound bites work wonders when it comes to raising money. And the amount involved is mind-boggling. The federal government subsidizes ethanol producers with a tax credit of 51 cents per gallon of fuel ethanol; those subsidies will total about $1.4 billion this year.
Corn Money
The Energy Department and the Agriculture Department spend tens of millions of dollars every year on biomass-based energy research and development. This is in addition to the billions of dollars -- more than $4 billion in 2004 -- the U.S. provides in subsidies for the production of corn, from which most domestically produced ethanol is derived.
If you look at the facts, the spending makes no sense whatsoever.
Consider how ethanol is produced. Corn is grown, harvested, and delivered to an ethanol plant. There the corn is finely ground and mixed with water. After fermentation, a mixture that is about 8 percent ethanol must be repeatedly distilled until it is 99.5 percent pure ethanol.
Growing and harvesting the corn, and heating and reheating the fermented corn to produce ethanol of a high enough quality to replace some of the gasoline in your car requires an enormous amount of energy. How much?
Adding It Up
A recent careful study by Cornell University's David Pimentel and the University of California at Berkeley's Tad Patzek added up all the energy consumption that goes into ethanol production. They took account of the energy it takes to build and run tractors. They added in the energy embodied in the other inputs and irrigation. They parsed out how much is used at the ethanol plant.
Putting it all together, they found that it takes 29 percent more energy to make ethanol from corn than is contained in the ethanol itself.
It's not that corn is a bad source for ethanol. The other sources mentioned by the president look even worse. Wood biomass takes 57 percent more energy to produce than it contains. Switch grass takes about 50 percent more.
Ethanol is just a highly uneconomical product. Some other authors have disputed these findings, but they invariably come up with more favorable calculations by excluding some of the costs.
Absurd Waste
Indeed, no matter how expensive fossil fuels become, ethanol will never be economical because it takes so much fossil fuel to produce. It might be possible that someday technological processes will emerge that make production of ethanol less reliant on fossil fuels, but the billions in subsidies to this point have left us with a process that is still a disgrace and an absurd waste of energy and taxpayers' money.
At least ethanol reduces pollution, right? Maybe the subsidies are worthwhile because they will buy us a cleaner environment.
Guess again. First, corn production, according to Pimentel and Patzek, ``uses more herbicides and insecticides than any other crop produced in the U.S.''
And the Environmental Protection Agency has cited ethanol plants themselves for air pollution. In a letter to the industry's trade group, the EPA noted that pollution was a problem in ``most, if not all, ethanol facilities.'' These plants produce large quantities of waste water as well.
Ethanol Cash
Ethanol itself contributes to air pollution. Cars emit more air pollution when they run on gasoline containing ethanol than they do when running on gasoline alone. Our environment would be greener if we stopped relying on ethanol.
The arguments against ethanol are so persuasive you have to ask yourself: Why does Congress keep throwing money at it?
The answer appears to be that elected officials from corn- growing states such as Iowa and Illinois see it as a cash cow for their constituents.
The ethanol business is a pretty good source of cash for the lawmakers too. The political action committee of Archer Daniels Midland Co., the world's largest producer of corn-based ethanol fuel, gave $69,000 to federal candidates for the 2004 elections, according to the Center for Responsive Politics.
In 2002, before such unlimited ``soft money'' donations were outlawed, ADM gave $1.8 million to political parties. Its political action committee gave close to $200,000 to individual campaigns and committees.
ADM spread the money around wisely that year, to beneficiaries ranging from Republican House Speaker Dennis Hastert of Illinois to Democratic Senator Tom Harkin from Iowa. Beneficiaries in 2004 included Hastert as well as Democratic Senator Kent Conrad of North Dakota.
Where's the Race?
Let's summarize the economics this way. Exxon Mobil Corp. had $36 billion in net income last year. If an alternative fuel source could be developed that would compete for that business, the potential rewards would be enormous. There would be a race to get there first, and firms would be lining up to do ethanol research. We wouldn't need a subsidy.
But even with decades of federal subsidies, private companies still haven't developed an economical ethanol, and public sector progress is minimal.
Bush's speech holds out hope that finally, after all those wasted billions, we are just six years away from a quality product. But it seems unlikely that the magic formula will soon be discovered. Folks have been distilling things for years. How much technical progress could the process possibly undergo?
The fact is, ethanol is a scam that allows farm states to extract resources from everybody else and pretend to be virtuous while doing so. We would all be better off if Congress just wrote these states a check with no strings attached. At least then we wouldn't be wasting all that energy.

daisies said...

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www.goodnewsindia.com
Mar 6, 2006:
Strategies for Bio-diesel:

http://www.goodnewsindia.com/index.php/Supplement/article/435/

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Cacoethes said...

Excellent post by Saras. I have been following the ethanol-as-automobile-fuel debate for 25 y, i.e, right from the time when the "brouhaha" started in Brazil. The Brazil 'experiment' amounted to subsidising the rich at the cost of the poor. The economics and the energy input-output balance (as detailed in the article cited by Saras) mitigate against use of ethanol as automobile fuel. Moreover, even distilled alcohol, i.e. the "azeotropic" mixture that is 95% ethanol and 5% water, will not mix completely with petrol, but will give rise to two layers. It will play havoc with ordinary internal combustion engines. As pointed out in Saras's post, it has to be at least 99.5% pure alcohol. The extra cost of producing 99.5% alcohol tilts the balance still further against ethanol as automobile fuel.

Cacoethes said...

Correction to my earlier post: **militate** against... (not "mitigate")

chalacuna said...

Brivery??? of course there too much lobbying by the oil companies to prevent production of alternative fuels that could affect the oil business.

Brazil on the other hand is very lucky because it is thier government who is campaigning for the use of ethanol, biodiesel and other alternative fuels.

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